Unprecedented changes are occurring in the health care marketplace across the country with significant changes in the organization and delivery of health care services. For consumers and providers of health care, these changes are of particular concern. The implications on the health care delivery system of medical centers downsizing, expansion of market control through network building, hospital mergers and the creation of hospital and health industry alliances is still not known. Health care is a dominant feature of the Philadelphia region's economy. It is the largest single source of employment in the greater Philadelphia metropolitan area, comprising 14% of the region's economy. The area has an unusually high concentration of medical schools, teaching hospitals, biotechnology industry and other components of the health care delivery system. The Philadelphia area's health care industry is implementing a variety of strategies in order to remain competitive in the changing marketplace: Thomas Jefferson University, Pennsylvania Hospital and Main Line Health are creating a provider alliance; Allegheny Health Education and Research Foundation (owner of the Medical College of Pennsylvania and St. Christopher's Hospital in Philadelphia) is merging with Hahnemann University Hospital and Medical School; and the University of Pennsylvania Medical Center is developing a comprehensive primary care network extending broadly into the suburban areas. Most dramatic, however, is the proposed merger of Independence Blue Cross and (the innovative/aggressive) Graduate Health System to create an unprecedented vertically integrated organization for health-care delivery that will provide and finance cradle services. Parallel industry restructuring includes the recent acquisition by local pharmaceutical giant SmithKline Beecham of United HealthCare Corporation's pharmacy-benefit services unit for $2.3 billion, as well as the decision by Kodak to sell Sterling Winthrop drug unit, located in suburban Philadelphia. The proposed one-day conference will bring together over 200 government and industry decision makers, researchers, students, media, consumers and other interested parties to examine and analyze the changing dynamics of the Philadelphia region's health-care marketplace. It will attempt to understand what is being done and the strategies being implemented by local academic health centers, hospitals, insurance and pharmaceutical companies, as well as other industries attempting to carve out a niche in the changing healthcare market. The conference will look at the Philadelphia region as a "laboratory" for these and other changes and will analyze the potential impact of these combined changes on the region's economy. The conference will be coordinated by the University of Pennsylvania's Leonard Davis Institute of Health Economics (LDI). LDI scholars have been extensively involved with health care industry leaders and government in analyzing changes in healthcare, both locally and nationally. In staging this conference, LDI will draw upon the collective expertise of its pool of scholars as well as collaborators from among government, industry and consumer groups.